Mergers & Acquisitions

Regardless of the nature and size of the transaction in question, our experienced team will work to maximize benefits — and minimize risks — for you. We can help with mergers and acquisitions, sales, joint ventures, other forms of purchase transactions and initial public offerings. We’ll provide support from pre-deal evaluation to completion and post-transaction integration in merger situations.

Since 2003, SB Partners’ Valuation Division has applied its creative, strategic expertise on behalf of businesses of all sizes, handling more than 50 transactions valued in excess of $450 million.

Case Study

Client Challenge

To satisfactorily resolve the buy-out of minority shareholders with an alleged financial oppression claim against the majority shareholder. Although the company was highly profitable, there was already significant debt leverage involving multiple lenders and the majority shareholder had no access to additional funds.

Fundamental considerations included:

Valuation of company acceptable by all parties

How to structure the buy-out in a manner that was both fair and tax-effective to all parties

Where to raise the necessary financing

SB Solution

Plan and facilitate a successful result by:

Quickly completing a company valuation calculation by our valuation group

Collaborate with each shareholder separately, legal counsel, existing lenders and prospective financing sources to determine acceptable structuring of a transaction to allow the minority shareholders to exit

Assist with controlling the anxiety and emotion among the shareholders until a satisfactory transaction could be completed

Impact

The minority shareholder buy-out was successfully completed within 90 days:

The minority shareholders were able to exit with a complete cash payment of their original capital and a superior return for the period of ownership. Through a series of pre-closing transactions the minority shareholders were able to receive their funds with either minimal tax, or no tax at all

In order to finance the transaction, new funding was achieved through a level of cost-effective subordinated financing from an Institutional lender and through an enhanced level of equity investment by one minority shareholder who decided to re-invest in the company pursuant to a fresh investment framework

The company continues to thrive, with ownership consisting of the majority shareholder and one minority shareholder with a significant percentage of equity ownership

The existing lenders are happy and company cash flow adequately supports all debt repayment obligations